Severance And Plants Retirements (exelon and Generation)

12 Months Ended

Dec. 31, 2013

Restructuring Charges [Abstract]

Corporate Restructuring and Plant Retirements (Exelon, Generation, ComEd and PECO)

17. Severance(Exelon, Generation, ComEd, PECO and BGE)

The Registrants have an ongoing severance plan under which, in general, the longer an employee worked prior to termination the greater the amount of severance benefits. The Registrants record a liability and expense or regulatory asset for severance once terminations are probable of occurrence and the related severance benefits can be reasonably estimated. For severance benefits that are incremental to its ongoing severance plan (“one-time termination benefits”), the Registrants measure the obligation and record the expense at fair value at the communication date if there are no future service requirements, or, if future service is required to receive the termination benefit, ratably over the required service period.

Merger-Related Severance

Upon closing the merger with Constellation, Exelon recorded a severance accrual for the anticipated employee position reductions as a result of the post-merger integration. The majority of these positions are corporate and Generation support positions. Since then, Exelon has identified specific employees to be severed pursuant to the merger-related staffing and selection process as well as employees that were previously identified for severance but have since accepted another position within Exelon and are no longer receiving a severance benefit. Exelon adjusts its accrual each quarter to reflect its best estimate of remaining severance costs. In addition, certain employees identified during the staffing and selection process also receive pension and other postretirement benefits that are deemed contractual termination benefits, which the Registrants recorded during the second quarter of 2012.

The amount of severance expense associated with the post-merger integration recognized for the year ended December 31, 2013 for Exelon and Generation was $6 million and $6 million, respectively. For Generation, $5 million represents amounts billed by BSC through intercompany allocations. There was no severance expense associated with post-merger integration recognized for the year ended December 31, 2013 for ComEd, PECO and BGE. Estimated costs to be incurred after December 31, 2013 are not material.

For the year ended December 31, 2012, the Registrants recorded the following severance benefit costs associated with the identified job reductions within operating and maintenance expense in their Consolidated Statements of Operations, except for those costs that were capitalized as regulatory assets related to ComEd and BGE:

Year Ended December 31, 2012
Severance Benefits (a)		Exelon (b)		Generation		ComEd (b)		PECO		BGE (b)
Severance charges	$	124	$	80	$	14	$	7	$	17
Stock compensation		7		4		1		0		1
Other charges		7		4		1		0		1
Total severance benefits	$	138	$	88	$	16	$	7	$	19

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• The amounts above include $46 million at Generation, $14 million at ComEd, $7 million at PECO, and $7 million at BGE, for amounts billed by BSC through intercompany allocations for the year ended December 31, 2012.
• Exelon, ComEd and BGE established regulatory assets of $35million, $16 million and $19 million, respectively, for severance benefits costs for the year ended December 31, 2012. The majority of these costs are expected to be recovered over a five-year period.

Amounts included in the table below represent the severance liability recorded by Exelon, Generation, ComEd, PECO and BGE for employees of those Registrants and exclude amounts billed through intercompany allocations:

Severance liability		Exelon		Generation		ComEd		PECO		BGE
Balance at December 31, 2011	$	0	$	0	$	0	$	0	$	0
Severance charges (a)		124		38		2		0		11
Stock compensation		7		2		0		0		0
Other charges (b)		7		2		0		0		1
Payments		(27)		(9)		(1)		0		(1)
Balance at December 31, 2012	$	111	$	33	$	1	$	0	$	11
Severance charges		5		1		0		0		0
Stock compensation		1		0		0		0		0
Payments		(64)		(24)		(1)		0		(5)
Balance at December 31, 2013	$	53	$	10	$	0	$	0	$	6

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(a)       Includes salary continuance and health and welfare severance benefits. Amounts primarily represent benefits provided for under Exelon's ongoing severance plan. One-time termination benefits were not material for the years ended December 31, 2012 and December 31, 2013.

(b)       Primarily includes life insurance, employer payroll taxes, educational assistance, and outplacement services.

Cash payments under the plan began in the second quarter of 2012. Substantially all cash payments under the plan are expected to be made by the end of 2016.

Ongoing Severance Plans

The Registrants provide severance and health and welfare benefits under Exelon's ongoing severance benefit plans to terminated employees in the normal course of business, which were not directly related to the merger with Constellation. These benefits are accrued for when the benefits are considered probable and can be reasonably estimated.

For the years ended December 31, 2013,2012, and 2011, the Registrants recorded the following severance costs associated with these ongoing severance benefits within operating and maintenance expense in their Consolidated Statements of Operations:

Severance Benefits (a)		Exelon		Generation		ComEd		PECO		BGE
Severance charges - 2013	$	18	$	16	$	2	$	0	$	0
Severance charges - 2012		19		14		2		1		3
Severance charges - 2011		5		5		0		0		4

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• The amounts above for Generation include $2 million, $0 million, and $1 million for amounts billed by BSC through intercompany allocations for the years ended December 31, 2013,2012, and 2011, respectively. Amounts billed by BSC to ComEd, PECO, and BGE were not material.

The severance liability balances associated with these ongoing severance benefits as of December 31, 2013 and 2012 are not material.